By CHRIS GRYGIEL, SEATTLEPI.COM STAFF

Published 10:00 pm, Monday, December 6, 2010

Washington voters established the citizen initiative process in the early 1900s to try to curb the outsized influence of railroads and other business interests had in Olympia, but a century later corporations now use initiatives to pass laws they want or to overturn legislation they dislike, the state election watchdog told lawmakers Tuesday.

David Seabrook, chairman of the Public Disclosure Commission, said campaign finance records were shattered in 2010. In 2000, just over $10 million was spent on ballot measures. This year, that number reached almost $60 million. For example, the American Beverage Association spent $16.7 million to pass Initiative 1107, which repealed soda and candy taxes lawmakers enacted this year. Costco spent $4.8 million in an unsuccessful push to get voters to privatize liquor sales.

Seabrook told the Senate Government Operations and Elections Committee the initiative process was designed to provide a check on corporate interests, but "that concept has been stood on its head."

"With the amount of money we're seeing spent in elections there's a concurrent need for better disclosure," Seabrook told lawmakers, who are meeting in preparation for January's legislative session.

Not all committee members were receptive to what the PDC and other advocates for more oversight on campaign spending were saying.

"It's like you're bashing corporations," said Sen. Pam Roach, R-Auburn. She said businesses and other interest groups were simply debating the issues.

"Confrontation is the lifeblood of politics...you can't expect people not to fight back," Roach said. "One thing I do not want to do, and really don't think it's the purpose of the PDC to come and vilify the system.. I don't want to see a foot in the door to say this is a convoluted, mutated son that occurred in the early 1900s."

Sen. Dan Swecker, R-Rochester, said the American Beverage Association represented "millions of people" who work in the industry. He also pointed out that corporate interests that spent millions to get the state out of the liquor business failed.

Regulators recommend that lawmakers strengthen campaign oversight rules and specifically address electioneering and "political speech" by corporate special-interests to ensure that the initiative process is not "hijacked by special interests."

They also PDC recommends that sponsors of telephone campaigning be disclosed, that the state work to overturn a recent U.S. Supreme Court ruling that allows campaign donations to remain secret in federal elections and that state penalties for violations of campaign disclosure rules are increased.

Right now the fines - $1,700 for a single violation - are too low, said Doug Ellis, PDC executive director. "The penalty paid could be seen as the cost of doing business," Ellis said.

The PDC is investigation two high-profile claims of election shenanigans from this year. Attorney General Rob McKennahas sued political consulting firm Moxie Media - which mostly does work for Democrats - for multiple alleged violations of the state's campaign financial disclosure law. Authorities say Moxie Media obscured the source of campaign support for an effort to oust a conservative Democrat the unions didn't like.

And the PDC is examining a conservative group accused of illegally targeting legislators with campaign mailers. Americans for Prosperity Washington filed formal registration forms on Nov. 10 - eight days after the election and the same day Democrats filed a complaint.

According to state law, political committees must file with the Public Disclosure Commission within two weeks of organizing, or of receiving or spending money. Americans for Prosperity Washington announced its creation on March 5. AFPWA is the state arm of a national political group that supports conservative candidates.

Sen. Craig Pridemore, D- Vancouver, said Monday it was important that voters know who was supporting which candidates and initiatives.

"I will be bringing forward a major piece of legislation this session to ensure disclosure."